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Dollar steady as markets await FOMC minutes
The yen swung in and out of negative territory following the release of Japanese growth data. Japanese stocks appeared encouraged by the numbers, with the broad Topix benchmark up 0.8 per cent and the Nikkei 225 advancing 0.6 per cent. The dollar/yen was last at 109 yen.
Japan’s GDP rose by 0.4 per cent quarter-on-quarter in the first three months of this year, up from a 0.4 per cent contraction in the December quarter. That exceeded expectations for a 0.1 per cent advance. There were some encouraging signs in the form of solid consumption, and lower oil prices also provided a boost, but business investment remained weak.
Markets will now turn their focus on the upcoming release of the FOMC minutes from the Fed’s most recent meeting for any further clues on the timing and pace of possible rate rises.
Two regional Federal Reserve Presidents commented that at least two rate hikes are possible this year.
The dollar index, a measure of the US currency against a basket of global peers, was one-quarter of a percentage point higher today at 94.781.
Gold, which is sensitive to US interest rate expectations, was down 0.3 per cent at $1,275.37 an ounce in Asia.
Oil prices, which continued to hover just below the $50 mark. Brent crude, the international benchmark, was up 0.2 per cent at $49.38 during Asian trading, but had risen as high as $49.75 on Tuesday. Brent was last above $50 in November last year. West Texas Intermediate, the US marker, was up 0.3 per cent to $48.46.
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